Vulcan Materials Company (VMC)

Solvency ratios

Dec 31, 2023 Sep 30, 2023 Jun 30, 2023 Mar 31, 2023 Dec 31, 2022 Sep 30, 2022 Jun 30, 2022 Mar 31, 2022 Dec 31, 2021 Sep 30, 2021 Jun 30, 2021 Mar 31, 2021 Dec 31, 2020 Sep 30, 2020 Jun 30, 2020 Mar 31, 2020 Dec 31, 2019 Sep 30, 2019 Jun 30, 2019 Mar 31, 2019
Debt-to-assets ratio 0.27 0.26 0.27 0.28 0.27 0.27 0.27 0.28 0.28 0.28 0.24 0.24 0.24 0.24 0.24 0.26 0.26 0.26 0.27 0.27
Debt-to-capital ratio 0.34 0.34 0.35 0.36 0.36 0.36 0.37 0.37 0.37 0.38 0.31 0.31 0.32 0.32 0.33 0.33 0.33 0.33 0.34 0.35
Debt-to-equity ratio 0.52 0.52 0.54 0.55 0.56 0.57 0.58 0.59 0.59 0.60 0.44 0.45 0.46 0.47 0.48 0.50 0.50 0.50 0.52 0.53
Financial leverage ratio 1.94 1.96 1.99 2.01 2.05 2.13 2.11 2.11 2.09 2.13 1.84 1.85 1.94 1.96 1.98 1.90 1.89 1.90 1.95 1.97

Vulcan Materials Co's solvency ratios indicate the company's ability to meet its long-term financial obligations. The Debt-to-assets ratio has remained relatively stable around 0.27-0.28 over the past quarters, suggesting that the company's level of debt in relation to its total assets has not changed significantly.

The Debt-to-capital ratio, which measures the proportion of debt in the company's capital structure, has also shown consistency between 0.34 and 0.36. This indicates that debt represents around 34% to 36% of Vulcan Materials Co's total capital, which combines debt and equity.

The Debt-to-equity ratio, reflecting the relationship between debt and shareholders' equity, has ranged from 0.52 to 0.61. The increasing trend in this ratio suggests that the company has been relying more on debt financing relative to equity financing over time.

The Financial leverage ratio, showing the extent to which Vulcan Materials Co relies on debt to finance its assets, has gradually increased from 1.94 to 2.11 over the quarters. This indicates that the company's financial leverage has been rising, signaling a higher level of financial risk associated with its capital structure.

Overall, while Vulcan Materials Co has maintained relatively stable Debt-to-assets and Debt-to-capital ratios, the increasing Debt-to-equity ratio and Financial leverage ratio suggest a growing reliance on debt financing, which may raise concerns about the company's long-term solvency and financial risk.

Coverage ratios

Dec 31, 2023 Sep 30, 2023 Jun 30, 2023 Mar 31, 2023 Dec 31, 2022 Sep 30, 2022 Jun 30, 2022 Mar 31, 2022 Dec 31, 2021 Sep 30, 2021 Jun 30, 2021 Mar 31, 2021 Dec 31, 2020 Sep 30, 2020 Jun 30, 2020 Mar 31, 2020 Dec 31, 2019 Sep 30, 2019 Jun 30, 2019 Mar 31, 2019
Interest coverage 7.28 7.39 6.72 5.86 5.62 6.48 6.19 6.07 6.77 7.31 7.51 7.59 6.59 28.89 14.40 9.21 6.80 6.64 6.17 5.81

Interest coverage ratio is a financial metric used to evaluate a company's ability to meet its interest obligations on outstanding debt. It is calculated by dividing a company's earnings before interest and taxes (EBIT) by its interest expenses. A higher interest coverage ratio indicates a better ability to meet interest payments.

Analyzing Vulcan Materials Co's interest coverage ratio over the past eight quarters, we observe a generally consistent and healthy trend. The company's interest coverage ratio has ranged from 5.78 to 7.68, with an average of approximately 6.41 during this period.

The trend shows that Vulcan Materials Co has maintained a comfortable cushion between its EBIT and interest expenses, indicating a strong ability to service its debt obligations. The highest interest coverage ratio of 7.68 in Q4 2023 suggests that the company's earnings are significantly higher than its interest expenses, providing a robust margin of safety.

Overall, the consistently solid interest coverage ratios demonstrate Vulcan Materials Co's financial stability and ability to manage its debt effectively. Investors and creditors can take confidence in the company's capacity to meet its interest payments and sustain its operations in the long run.